Correlation Between Development Investment and FPT Digital
Can any of the company-specific risk be diversified away by investing in both Development Investment and FPT Digital at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Development Investment and FPT Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Development Investment Construction and FPT Digital Retail, you can compare the effects of market volatilities on Development Investment and FPT Digital and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Development Investment with a short position of FPT Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Development Investment and FPT Digital.
Diversification Opportunities for Development Investment and FPT Digital
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Development and FPT is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Development Investment Constru and FPT Digital Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FPT Digital Retail and Development Investment is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Development Investment Construction are associated (or correlated) with FPT Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FPT Digital Retail has no effect on the direction of Development Investment i.e., Development Investment and FPT Digital go up and down completely randomly.
Pair Corralation between Development Investment and FPT Digital
Assuming the 90 days trading horizon Development Investment Construction is expected to generate 1.05 times more return on investment than FPT Digital. However, Development Investment is 1.05 times more volatile than FPT Digital Retail. It trades about 0.36 of its potential returns per unit of risk. FPT Digital Retail is currently generating about -0.37 per unit of risk. If you would invest 1,745,000 in Development Investment Construction on November 29, 2024 and sell it today you would earn a total of 240,000 from holding Development Investment Construction or generate 13.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Development Investment Constru vs. FPT Digital Retail
Performance |
| Timeline |
| Development Investment |
| FPT Digital Retail |
Development Investment and FPT Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Development Investment and FPT Digital
The main advantage of trading using opposite Development Investment and FPT Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Development Investment position performs unexpectedly, FPT Digital can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in FPT Digital will offset losses from the drop in FPT Digital's long position.| Development Investment vs. South Books Educational | Development Investment vs. Petrolimex Insurance Corp | Development Investment vs. Saigon Beer Alcohol | Development Investment vs. Fecon Mining JSC |
| FPT Digital vs. Mobile World Investment | FPT Digital vs. Elcom Technology Communications | FPT Digital vs. Hochiminh City Metal | FPT Digital vs. Vien Dong Investment |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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